BuzzFeed will lay off 15% of its staff, or about 250 employees, according to an internal memo first reported by the Wall Street Journal and confirmed by Axios.
Why it matters: Like other venture capital-backed digital media companies, BuzzFeed has struggled to increase revenue to meet growth expectations, although sources tell Axios that the company is profitable.
Between the lines: BuzzFeed CEO Jonah Peretti has in the past alluded to the fact that the company would be open to merging with other media companies in order to achieve the scale needed to compete with bigger tech companies, like Google and Facebook.
- The company has diversified its revenue stream to include commerce and subscriptions in order to increase revenue. It cut 100 people in 2017 and laid off members of its podcast team last year amid a restructuring of its audio strategy, but has otherwise avoided a layoff of this size until now.
I’m writing with sad news: we are doing layoffs at BuzzFeed next week. We will be making a 15% overall reduction in headcount across the company. I’m sending this tonight because I wanted you to hear it from me directly instead of from the press.
Over the past few months, we’ve done extensive work examining the trends in our business and the evolving economics of the digital platforms. We’ve developed a good understanding of where we can consolidate our teams, focus in on the content that is working, and achieve the right cost structure to support our multi-revenue model. We are confident the changes we are making will put us on a firm foundation and allow us to invest and grow sustainably for years to come.
I’m so proud of what our team accomplished over the last year, including diversifying our revenue, and growing our business double digits. Unfortunately, revenue growth by itself isn’t enough to be successful in the long run. The restructuring we are undertaking will reduce our costs and improve our operating model so we can thrive and control our own destiny, without ever needing to raise funding again. These changes will allow us to be the clear winner in the market as the economics of digital media continue to improve.
I’ll share more about our future structure in a few days, but today I want to focus on what will be a difficult week, especially for the people who are leaving the company. These are talented people, friends, and valued colleagues, who’ve made huge contributions to our success, and who’ve done nothing wrong. Even though I’m confident this is the right business decision, it is upsetting and disappointing.
On a personal note, I’ve never thought about my job as “just business.” I care about the people at BuzzFeed more than anything other than my family. This will be a tough week for all of us and I realize it will be much worse for the people losing their jobs. To them, I want to say thank you, I’m sorry our work together is ending this way, and I hope we get to work together again in the future. Our loss will be to the benefit of other organizations where I know you will go on to make formidable contributions.
We will be back to you with specifics on the process by Monday at the latest. Thank you all in advance for your compassion and kindness as we go through this process.— BuzzFeed CEO Jonah Peretti